HCFA Fraud-Catching Plan Behind Schedule

By Patience Wait, Staff Writer


NOV. 6 ? The Health Care Financing Administration is lagging in its plans to set up a central data storage and retrieval system, complicating efforts by the federal health care organization to establish a new screening process for Medicare providers, according to a recent study from the Government Accounting Office.


HCFA's current process does not adequately screen for dishonest or unqualified providers, GAO said in a Nov. 2 letter to Rep. Fortney "Pete" Stark, D-Calif., ranking minority member of the House Ways and Means Subcommittee on Health.


About 39 million elderly and disabled Americans receive health insurance coverage through Medicare. Health care providers include physicians, hospitals, suppliers and other medical professionals. Screening of provider applicants now is contracted out by HCFA to about 60 insurance companies nationwide.


In 1999, HCFA identified deficiencies in the enrollment procedures of six out of 15 contractors evaluated during its routine assessments of their performance. Some contractors, for example, were not screening applicants against the list of excluded providers maintained by the Health and Human Services Office of Inspector General and the General Service Administration debarment list.


The agency has submitted draft regulations to the Office of Management and Budget to revise the enrollment process, including a provision that Medicare providers periodically review and certify the accuracy of their enrollment information.

The centralized data system, the Provider Enrollment, Chain and Ownership System was intended to facilitate the process, but the GAO report found it has fallen behind schedule, compounding the problem. PECOS was to be in place in February 2000, but HCFA now plans a gradual phase-in between November 2000 and 2003.


To help streamline the provider enrollment process, HCFA is considering cutting the number of insurance companies that screen provider applicants. GAO supported the proposal.


HCFA said more needs to be done to establish standards and improve the provider enrollment process. But it defended the integrity of the Medicare system, stating that the risk to the program from billings submitted by excluded providers has been very low, and that insurance companies denied more than 2,000 applications between April 1999 and April 2000.